Evidence of meeting #132 for Industry, Science and Technology in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was arr.

A video is available from Parliament.

On the agenda

MPs speaking

Also speaking

Mark London  Director, Art Dealers Association of Canada
April Britski  Executive Director, Canadian Artists' Representation
Joshua Vettivelu  Director, Canadian Artists' Representation
Debra McLaughlin  General Manager, Radio Markham York Inc.
Bernard Guérin  Executive Director, Regroupement des artistes en arts visuels du Québec
Dan Albas  Central Okanagan—Similkameen—Nicola, CPC
Moridja Kitenge Banza  President, Regroupement des artistes en arts visuels du Québec
Vance Badawey  Niagara Centre, Lib.
Clerk of the Committee  Mr. Michel Marcotte
Michael Chong  Wellington—Halton Hills, CPC

4:30 p.m.

Liberal

The Chair Liberal Dan Ruimy

Thank you.

Before we move on to Mr. Lloyd, Ms. Britski, you mentioned some reports, some studies. Could you forward those to us so we could have a look at them? That would be helpful. Thank you.

Mr. Lloyd, you have five minutes.

4:30 p.m.

Conservative

Dane Lloyd Conservative Sturgeon River—Parkland, AB

Thank you for attending today.

My first question will be for Mr. London. The droit de suite was agreed upon in the European Union because if some countries didn't agree, it seemed likely that art would move to those countries to be sold, if they didn't have that right.

The first part of my question is, does the United States have that right? If we were to implement this right, what would be the impact on art sales and the art economy in this country, given our being next to the United States?

4:35 p.m.

Director, Art Dealers Association of Canada

Mark London

Well, as I said, it's a very real fear that sales at the higher end of the market would move south of the border. Forgetting all the private sales that will circumvent the traditional gallery or auction house market, what's to stop a major Canadian auction house from opening up in Buffalo instead of Toronto so that their million-dollar sales will happen south of the border?

4:35 p.m.

Conservative

Dane Lloyd Conservative Sturgeon River—Parkland, AB

Practically speaking, if somebody goes to the United States and purchases this, and then comes across the border and pays the tax or whatever on the price of the good, does the resale right follow attached to it, or is it that the resale right is labelled—

4:35 p.m.

Director, Art Dealers Association of Canada

Mark London

I haven't a clue. I think it's in the venue where the piece is sold. It's like when something is being imported, assuming it's being imported with the correct price attached, as opposed to coming in with a zero that has miraculously dropped off.

4:35 p.m.

Conservative

Dane Lloyd Conservative Sturgeon River—Parkland, AB

My family does art cartage between New York City and Toronto quite frequently, so—

4:35 p.m.

Director, Art Dealers Association of Canada

Mark London

Okay. All this is assuming that the GST, HST, PST or whatever would be collected at the border, but I don't know that.... Again, it's not the government's job to collect that.

4:35 p.m.

Conservative

Dane Lloyd Conservative Sturgeon River—Parkland, AB

That seems like a major problem with getting ARR in Canada, if the United States doesn't follow suit.

4:35 p.m.

Director, Art Dealers Association of Canada

Mark London

Exactly. That's what I was saying. In all these venues where it's a shared thing, it's almost like 90 countries agreeing to use Times New Roman 12 instead of Arial 14. It's a compliance issue, so it's the same across trading partners.

4:35 p.m.

Conservative

Dane Lloyd Conservative Sturgeon River—Parkland, AB

I'll move on to my next comment, followed by a question. It seems that these stories about an art piece being sold for.... There was a fellow in Smiths Falls, Ontario, who has since passed away, Harold Nichol. He used to carve duck decoys for hunting. Years later, to anyone who had these duck decoys—in fact, my family had some—these were worth tens of thousands of dollars, and it was just some fellow who was handcrafting them.

It seems to me that it's a very rare case in which an art piece.... It's like winning the lottery. Would you say it's like that?

October 17th, 2018 / 4:35 p.m.

Director, Art Dealers Association of Canada

Mark London

This is just it. Unfortunately, in the art business, we're selling a fantasy, much like the case with lottery tickets. When the Ontario lottery advertises that Mr. and Mrs. Smith of Leamington, Ontario won the 6/49, they don't say, “and, by the way, there were 20 million other ticket holders who lost their money.”

In other words, the reality is that whatever the threshold is—be it a thousand dollars, a thousand euros, whatever—pieces that are bought for, say, $10,000 at a gallery or auction often resell for significantly less, because when it's time to sell—because of death, divorce or bankruptcy, or because it no longer matches the drapes—then you get what you get. If you paid $10,000 and it resells for $2,000, it's adding insult to injury to have to pay....

4:35 p.m.

Conservative

Dane Lloyd Conservative Sturgeon River—Parkland, AB

Let's take the perspective of just your regular artist. It's like those 20 million lottery ticket holders; they're not winning the lottery. If this resale right is implemented, yes, it could help that one person who wins the lottery and sells that piece of art, which is resold and resold; they're making great royalties. Will it, however, negatively impact the average middle- or lower-class artist?

4:35 p.m.

Director, Art Dealers Association of Canada

Mark London

It's really hard to say.

In the United States, California enacted an ARR in the 1970s, which was just overturned by the courts. It all came about after an auction where a Robert Rauschenberg painting that was originally sold for something like $50,000, let's say, was sold for $500—I'm inventing numbers. Rauschenberg was irate, and they argued the case and got the ARR passed in California.

Just to give you an example, Robert Rauschenberg left an estate of $600 million U.S. That's lottery-winning odds. In other words, getting an ARR wouldn't help Robert Rauschenberg or his estate, because he was fabulously wealthy, but would the other artists have winning tickets?

4:35 p.m.

Conservative

Dane Lloyd Conservative Sturgeon River—Parkland, AB

We've been talking about supply and demand related to Inuit art. Would you say that if we're adding a tax or a fee or something onto an art piece, we would be lowering the compensation that artists would be receiving up front for the sale of that?

4:35 p.m.

Director, Art Dealers Association of Canada

Mark London

If there were some sort of flow-through, so that it was understood that there are certain steps required to bring things to market that would somehow not involve an ARR, then it wouldn't raise the price incrementally.

In other words, if someone has to pay to ship a piece from Cape Dorset down to the co-op in Toronto, that gets factored into the price, as does the shipping into Montreal. An ARR would be no different. You're adding to the cost of the piece.

4:40 p.m.

Conservative

Dane Lloyd Conservative Sturgeon River—Parkland, AB

That lowers the demand for the product, though, doesn't it?

4:40 p.m.

Director, Art Dealers Association of Canada

Mark London

It doesn't necessarily lower the demand. The demand is low enough. You're raising the retail price, which makes it less competitive in the marketplace. In other words, if it's hard enough to sell at $5,000, it's going to be that much harder to sell at $6,000.

4:40 p.m.

Conservative

Dane Lloyd Conservative Sturgeon River—Parkland, AB

Basically, you're saying an ARR could make our artists less competitive.

4:40 p.m.

Director, Art Dealers Association of Canada

Mark London

Indeed. That's our big concern.

4:40 p.m.

Conservative

Dane Lloyd Conservative Sturgeon River—Parkland, AB

If you're not the lottery winner, you could be hurt by this policy.

How much time do I have left?

4:40 p.m.

Liberal

The Chair Liberal Dan Ruimy

You're way over. I let you go.

Now we're going to move to Mr. Jowhari. You have five minutes.

4:40 p.m.

Liberal

Majid Jowhari Liberal Richmond Hill, ON

Thank you, Mr. Chair.

Welcome to all the presenters, especially Ms. McLaughlin, who is coming from York region, with Richmond Hill at the heart of it.

Let me start by taking a different slant on visual art. We talked about ARR a lot, but in this forum I have visual artists, an association and an art dealer. It gives me a great opportunity to ask the question I asked last time, which was actually deferred to this panel.

I wanted to talk about the impact of the digital era and the visual art that's being created through new technologies, such as 3-D printing and AI. As you all know, through various computer systems or computer programs, you can scan many different archives and create a new art type, and you can make it into visual art through 3-D printing.

I'm going to start with the two artists we have here. Whom would you consider the owner of the art when it's created through this method? Either of you could start.

4:40 p.m.

President, Regroupement des artistes en arts visuels du Québec

Moridja Kitenge Banza

The creator is me, the artist. The computer is only a tool, such as the paintbrush, metal or clay for sculptures, or the glass for blown glass. The computer is only a tool used to create the work. Basically, I'm the person who creates the work. It's not the computer, even though I code the information in the computer to create the work.

4:40 p.m.

Liberal

Majid Jowhari Liberal Richmond Hill, ON

Is this even though the AI and the new technology have taken the combination of many different arts or, let's say, paintings, and created a 3-D version? Part of your creation might have been incorporated into it.

4:40 p.m.

President, Regroupement des artistes en arts visuels du Québec

Moridja Kitenge Banza

There's already legislation in place. For example, in Quebec, the Act respecting the professional status of artists in the visual arts, arts and crafts and literature and their contracts with promoters specifies who is considered a professional artist. The act states that professional artists produce works and are recognized by their peers. Obviously, a machine isn't recognized by its peers.